By Davison Vandira
Economic analysts have raised concern and called for decisive action on the possibility of increased cost-push inflation due to ever-increasing fuel prices.
The call comes as Zimbabwe’s monetary and fiscal authorities are envisaging a 20 percent year-on-year inflation level by year end.
The country has generally enjoyed macroeconomic stability over the past year, but economists are worried about the contagion effect the month-on-month fuel price increases might have on the economy.
If left unchecked, the fuel price increases will have a domino effect that will threaten the economic objectives as spelt out by the National Development Strategy One, the analysts say.
“The ongoing fuel price increases are should be moderated because they have got distribution a potential of negating the gains we have so far achieved on inflation over the past,” says industrialist, Kipson Gundani.
Dr Prosper Chitambara Chitambara, a development economist, noted: “Under the Zimbabwean perspective, fuel is used at every turn of the production and cycle as such its upward review will have a knock-on effect to prices hence the need to always keep it stable for long periods.”
It iseconomic analysts’ considered view that moderation of fuel prices will spearhead and strengthen the economy’s competitive resolve against its regional counterparts.